Pana Automotive is a large Melbourne-based automotive parts manufacturer that supplies the local automotive industry. Facing increasing competitive pressures, as well as significant growth via acquisitions of (previous) competitors, management is concerned that the company’s current accounting system needs to be replaced with an Enterprise Resource Planning (ERP) system. Due to the nature of this acquisition growth strategy, and the fact that the manufacturing and warehouse facilities are located across sites in several suburbs in Melbourne, some of the accounting systems in the company do not directly communicate with each other. As a senior systems consultant at Lybrand and Coopers, Chartered Accountants, you were invited to a meeting with the CEO and CFO of Pana to discuss the potential for an ERP implementation at Pana. During that meeting, many questions and issues were raised by the CEO and CFO, with four of these issues listed below. Required: In the space provided beneath each part of this question, briefly discuss how a successful implementation of an ERP would help overcome this issue. 

(a) The warehouse recently shipped inventory to the old address of an important customer. An investigation found the customer’s new shipping address had not been updated in the customer information files in all departments and locations. 

(b) The customer relationship manager complains that Pana’s production department is too slow to produce inventory to fulfill orders in a competitive timeframe. The production manager argues that the customer relationship manager often doesn’t share intelligence about upcoming orders until it’s too late to coordinate all production activities to meet the fulfilment date. 

(c) The IT manager comments that she cannot meet her department’s budget and continue to support and maintain Pana’s amalgamation of old legacy accounting information and manufacturing systems. 

(d) Senior managers have been complaining that existing systems are not providing sufficient critical information to properly monitor and manage the business. Whilst providing ‘scheduled’ reports, the existing accounting system offers little opportunity for ‘demand’ or ad-hoc reporting and online analytical processing (OLAP).

Answer rating: 100% (QA)

a The warehouse recently shipped inventory to the old address of an important customer An investigation found the customers new shipping address had not been updated in the customer information files ... View the full answer